TNAG-0780-FCO40-984-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 167

They

11 The Australians took the line that (a) would not permit low fares which were important to them for domestic political reasons. If this option were forced upon them there would be a sharp reaction from the Australians against the UK. (d) they said was impossible because they had reseached exhaustively for a soft option and come up with none. hinted that if HMG refused a commitment in principle to the present proposal they would have to turn to (c) or possibly even examine again the options in (b). (b) is discussed in paragraph 3 above. We are not attracted to 3(i) for the reasons given. Neither do we think that it would find favour with the Australians even as a last resort. The Australains are unlikely to change their attitude towards the charter option (3(ii)) as a means of achieving their low fare objective. We on the other hand believe that a small charter presence might serve a useful purpose and we are not convinced that it need be incompatible with the Australian scheme. We intend to discuss this further with them. (c) above could be introduced without our concurrence and would inevitably lead to a serious deterioration in our air services relations with Australia. It would be seriously detrimental to BA's position. Only as a last resort however would the Australians be likely to go for this option.